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Last week, Transport Canada announced it agreed to lease 12,000 grain hoppers to the Farmer Rail Car Coalition for five years and sign-off on a permanent transfer after the lease expires. The transfer price would be $205 million, comprising $65 million in lease payments during the five years, a $35 million credit for car overhauls performed by the coalition and a final $105 million payment to be spread over an eight-year period.

Transport Canada plans to finalize the lease-purchase agreement next year after the coalition obtains car-use contracts from Canadian National Railway Co. and Canadian Pacific Railway. In 2002, the coalition — which includes members from western grain producers, agricultural associations and rural government organizations — submitted a proposal to the Canadian government seeking to acquire the hoppers.

“This lease-purchase arrangement effectively balances the interests of producers with those of the industry and taxpayers,” said Canadian Transport Minister Jean Lapierre in a prepared statement.